Protection tips for your smartphone

Smartphones are more than just mere devices for most people. Some treat them as investments, while for others the gadgets serve as 24/7 friends. That’s why it’s important to keep your smartphone safe at all times.

Here are some tips to keep your device in pristine condition. 

For more finance tips, visit Moneymax.

source: news.abs-cbn.com

How to get rid of personal debt

Incurring personal debt is among the problems hounding some Filipinos as the new year approaches. But a financial advisor reminds the public the cycle of borrowing can be overcome.

source: news.abs-cbn.com

Sesame Street goes global to teach kids about money

(The writer is a Reuters contributor. The opinions expressed are his own.)

NEW YORK - Translating money messages to 100 million kids around the world is not a feat for ordinary humans - you need monsters.

Elmo and Cookie Monster, to be specific.

These two and their furry band of Muppets have been part of Sesame Workshop's "Dream, Save, Do" program, a joint venture of Sesame Street and the MetLife Foundation. Operating for the last four years, the initiative has been leveraging famous Sesame characters to foster financial empowerment for families in nine countries: Mexico, Brazil, Chile, China, Japan, India, Bangladesh, Egypt and the UAE

The outreach has so far been a whopping success in terms of the numbers reached, Sesame Workshop concluded at a summit last month that brought together country directors. The most difficult challenge they identified was how hard it was to translate money messages across different countries and cultures.

One example: A Cookie Monster cartoon about the concept of delayed gratification - which involved waiting for an apple pie to bake - did not make much sense in the Chinese diet. So what did they do? They changed the desired object to dumplings - and it was a hit.

In India, the idea of 'work' was conveyed by the image of a woman sewing; in Brazil, it was someone answering a phone in an office. In some countries 'water' was a tap in a crowded alley; in others it was a sink in a home.

In China, there is no huge need to teach kids about the concept of saving - because all of them are doing it. Many, even at extremely young ages, are planning for college or thinking about their first house. So instead of focusing on saving, local course designers in China tacked towards teaching other financial behaviors like sharing or donating.

"Every lesson has core common elements, but it also tailored to the local market, which is the real magic of it," said April Hawkins, an assistant VP at the MetLife Foundation who helps steward the program.

Sesame Workshop also had to be flexible about how it got the word out. For instance, in the slums of India's New Delhi, a typical structured classroom setting just was not going to be possible.

"So in the narrow alleyways of Delhi, we ended up using vegetable carts," said Shari Rosenfeld, Sesame Workshop's Senior VP for international social impact. "We set up DVD players to broadcast our materials, hooked them up to car batteries, loaded them onto carts, and kids and their families would all gather around."

RESTORING HOPE

In some countries, even the name of the program itself was changed. In areas where there is not a lot of money kicking around, and poor kids might not be able to "save" much of anything, the program title was altered to "Dream, Plan, Do."

And which characters, exactly, were tapped to spread the money messages? Not The Count, as you might expect, given his obvious passion for numbers.

Instead, Sesame Street already has an entire cast of popular foreign characters at their disposal. There are existing stars like Lola in Mexico, Chamki in India, Bel in Brazil and Lily in China - all smart, confident young female characters.

In one popular piece of content, all those girl characters from around the globe gathered to sing a song about female empowerment, goal-setting and achievement.

So what is next for Dream, Save, Do? It could very well be the global refugee crisis. Many children have lost everything, so what do you tell a child like that?

"Hope is often lost in communities that have experienced such trauma and distress," says Nada Elattar, Sesame Workshop's director of educational programs. "So that is something we have to focus on next: The idea of having dreams for yourself, and setting goals, as a way to restore hope."

source: news.abs-cbn.com

Buying your first home? Here are 7 things to consider

MANILA - We all dream of owning a home someday. And why not? A home means stability and permanence, where one’s family can grow roots, seek refuge and build a life together. At the same time, it is always a valuable asset and an investment in itself.

Have you thought about buying your own home but don’t know where to start? Have you ever wondered if you can even afford it? If you can, do you have an idea of what your money can buy? Whether you’re thinking of getting a tiny studio unit or a sprawling house with a large yard, you will need to put considerable thought into your plan.


Owning a home calls for responsibility and commitment. It calls for a lot of thought and a careful evaluation of your lifestyle, finances, as well as your present and future needs. Here are 7 factors to consider in deciding if you are ready to own your first home.

1. Are you ready for this investment?

Do you have enough funds to buy your dream home? Do you have a regular source of income? Are you getting a big inheritance soon? A house is usually a considerable investment, and you need to have enough money to be able to purchase one. If you plan to take out a loan for your home, you still need to have the financial capacity in order to qualify for financing schemes offered by both banks and developers.

2. Consider your present and future plans.

A house is not exactly easy to dispose, considering the sums involved as well as the paperwork and taxes that it entails. This is why you have to know your reasons for buying a house, and think how this fits with your life plans. For instance, are you planning to move out of the country anytime soon? If so, having a house makes you less mobile. Are you planning to have children soon? If so, you might want to think about getting something bigger than a tiny studio in order to accommodate your growing brood.

3. Location, location, location.

This is one of the most important considerations you have to think about when getting a house. Location almost always dictates price, which means while you may be able to afford a townhouse outside Metro Manila, you may have to shell out more for a similar unit in the city. At the same time, its location will affect your life – the amount of time you need to go to work, or the places you will most likely frequent. You need to think of a location that is best suited for your needs.

4. Let's talk financing.

Even if you do not have cash to pay upfront for a house, you may actually qualify for financing. Banks offer loans, as well as developers. Loans could stretch for as long as 25 years, depending on your age. Gauge your capacity to do regular amortizations, and check how it would impact your cash flow. Most financial experts recommend that payments on homes should constitute no more than 1/3 of your regular expenses. Also look at interest rates.

5. Look to the future and appreciation potential.

When buying a house, you should also consider how its value is likely to increase in the future. Look at developments that could possibly lead to an increase in the property’s value – new roads, malls or other commercial developments usually push property values higher. This means that you can actually sell your property later on and stand to earn from the transaction.

6. Remember the warning "Buyer Beware."

When buying property, you need to make sure that everything about the transaction is above board – the title should be free from liens and encumbrances, taxes should have been paid, and association dues settled. You also want an assurance that your house was built well and in keeping with building standards. This is why it is important to know the background of the seller. Some developers have a solid track record, but even then, make sure to do your research about the seller.

7. Ask yourself: To build or to buy?

Do you prefer to build your own house instead of buying one? This allows you to design everything according to your own wishes. However, it is also a more time-consuming process since you have to deal with an architect and contractor, while checking regularly on the work. You also need to find people that you can trust to build your home.

Owning your first home is a major decision, so make sure to think through the process before making any decision. Ask questions, do your research, and think about your life plans before you make the decision.

source: news.abs-cbn.com

New digital piggy bank helps Swiss kids save

ZURICH - In Switzerland, one of the world's wealthiest countries, financial planning starts young.

The country's number two bank Credit Suisse on Tuesday unveiled a piggy bank with built-in apps allowing children under 12 to set savings goals, check their balance and make payments.

"The financial education of children is a concern to people in Switzerland," Credit Suisse said in a statement, citing a recent study showing that 90 percent of parents in the wealthy Alpine nation want their children to learn how to handle money.

The study, conducted by the amPuls market research firm on behalf of Credit Suisse, also found that most children in Switzerland not only receive pocket money but "are frugal with it".

According to the research, Swiss parents have asked questions about how to teach children about money when it increasingly exists in digital form instead of coins and notes that can be stored in an old-fashioned piggy bank.

Named Viva Kids, the piggy bank "provides a wide range of options for teaching kids in a simple way how cash and digital money work and how to use them," Credit Suisse said.

source: news.abs-cbn.com

What To Do When Comparing Personal Loans

MANILA - Looking to get a personal loan? You may be looking for alternative sources of funding for big life purchases, such as your child’s tuition or a long holiday abroad. You may be looking for extra funds to start a business or for some long-overdue home repairs.

Banks and lending agencies can surely help. Provided that your financial history meets their expectations, you can borrow the money you need with a personal loan.

Personal loans work very differently from other types of debt, such as credit cards and mortgages. Here, we give you the most important details you should look for when shopping for a personal loan:

source: news.abs-cbn.com

How to live a debt-free 2016

Everyone's circumstances when it comes to being in debt are different but you should eliminate all your debt as soon as you can.

Here are tips to living a debt-free 2016:

To read more information on personal finance, head on to MoneyMax.ph.

Mobile users can view the desktop version of the slideshow here.

 

source: www.abs-cbnnews.com

Tips to Ensure Your Bad Credit Doesn’t Cost You a Job

Unbelievably your bad credit can cost you a job. Employers can examine you and if they discover your credit score is low, they may decide not to employ you.

Why is this?

They believe it is a mark of a lack of responsibility. Someone who cannot take care of their finances should not have a position of responsibility within the company. It is a hard reality to deal with. There are actions you can take to ensure this does not happen, though.

Establish a Secure Line of Credit

Store cards and cards for people who have bad credit are an ideal way to begin rebuilding your credit score. There are two main features to these lines of credit:

1. They have higher interest rates.

2. You can expect them to have far lower limits.

They are like the training wheels of the financial world. Once you learn how to use these correctly, you can graduate to riskier cards with higher limits and lower rates.

Utilization Rates

You should never use more than 30% of your credit limit at one time. This is known as the utilization rate. If you have a utilization rate of 30% or over, this is a sign you are financially irresponsible. It is an example of you relying on your cards to survive, and that is not a good sign.

Only go over these limits in an emergency, and make sure you get below this limit as soon as you can to preserve your credit score.

Pay On-Time and in Full

Late and partial payments have the biggest detrimental impact on your credit score. Whenever you make a purchase on a card, you should always check whether you can meet the repayment by the deadline. If you cannot do not make the purchase.

When Your Score Improves

As your score creeps towards the 680 mark this is where you start to appear on the databases of credit card companies. This is where they are interested in sending you offers for higher tier credit cards. Acting in the wrong way here can cause your score to plummet once again.  Just be sure that there are some things that can kill your credit score.

If you want to keep your chances of getting that job high, stick to the same principles as before. Only take higher tier credit cards if you know you can make the repayments and prevent yourself from getting carried away.

On the other hand, dealing with higher amounts of credit successfully can continue to push your credit score ever higher. A bad credit score can destroy your ability to get a job, but a good credit score can enhance it.

Conclusion

It is unfair that something like personal finance can now come into finding a job. However, we cannot do anything about it. Your only option is to work on improving your credit score.

It really depends on the type of job you are applying for, though. Remember that good personal finance is a mark of responsibility and integrity. If you are applying for a position that requires both of these things, expect them to check your score. If not, you might not need a good credit score.

Have you ever encountered a situation where a credit score has held you back from getting a job?

source: 20smoney.com

Just married? Here are 7 money tips

Now that your dream wedding is over, what's next? To keep you in the honeymoon stage as long as possible, it may help to know that money problems are one of the most common causes of friction in married life.

It doesn’t matter if you have loads of cash or just have enough to get you by. Now that you’re married and all your money and assets are conjugally-owned (unless you had a prenuptial agreement), you may one day find yourselves running into arguments over how to manage your finances and assets on a day-to-day basis.

To avoid these issues and set your marriage off to a good start, especially on the money front, here are some tips to help you:

Discuss your life goals

To plan and manage your finances together, you need to know each other’s goals in life since these will determine your spending and your investment strategy. Do you want to have children? If so, how many and how soon? Do you plan to buy a house? If so, what is your time table for this? Do you plan to relocate? Pursue further studies? Start a business together? Travel? Goals can evolve with time, and make it a habit to revisit your goals every so often.

Set your priorities

This is directly related to the first. Money issues usually begin when spouses cannot agree on their priorities. Before these issues come up, have a conversation so that you would know what matters to each of you as individuals and as a couple. Let’s say you both decide that starting a business is your top priority for now, then both parties would understand that most of your joint funds will be going to the business, and that purchases of big-ticket items such as a house or car may have to take a back seat in the meantime.

Set a monthly budget

Now that you know each other’s life goals and priorities, set a monthly budget that you can live with. This will be based on your joint monthly income. Determine how much you would spend on the basics (utilities, housing, transportation) as well as on non-necessities (entertainment, leisure). Make sure to set aside an amount for savings. Determine how much each one would contribute to this budget (if applicable) and agree to regularly review this budget.

4. Decide on your bank accounts. Discuss if you would want to have separate bank accounts, a joint account, or both. Most likely, both of you already have individual accounts. If you are employed, then you would continue to have your own personal bank account. You may also wish to talk about how you would regard each other’s money. Some couples may prefer to have freedom to use their own money, while others may be more comfortable consulting each other on various expenses. This would differ greatly among couples, so you need to know what you are both most comfortable with.

Have a record filing system

Records are often overlooked by most people, but this is very important so that you can study your finances and have quick access to all the important records you need to have available. This would include bank statements, real estate titles, billing statements, etc. Make sure that both of you know where to find these records. You can also keep electronic copies of these records using various shared programs and apps that both of you can access anytime.

Start investing

Investing early in your marriage gives you one great advantage: time. You don’t need large amounts of money to invest especially in mutual funds or other investment products for retail investors. What you invest in will depend on your circumstances and your strategy, of course. Make sure you top up as you go along. Find a financial adviser you both trust and are comfortable with.

Set up a sinking fund

Both of you can contribute to this fund on a regular basis. Agree on how this will be used—as an emergency fund, to purchase a large-ticket item that you are planning for, to pay for childbirth expenses, etc.

As with almost anything concerning your marriage, your joint finances will run smoothly if you both remain open and honest to each other about the direction you want it to take. All it takes is a little careful planning—and a whole lot of communication.

source: www.abs-cbnnews.com

TIPS: Protecting your finances when selling a business

MANILA – There comes a time when entrepreneurs are faced with the tough decision of whether or not to sell the business or allow a major investor to buy a big slice of the pie.

According to John Bly, a managing member of LBA Haynes Standard, entrepreneurs should prepare their personal finances when facing mergers and acquisition opportunities.

To prepare for mergers and acquisitions if you are a small business owner, Bly suggests preparing enough reserves aside, putting yourself in a good credit position, and be ready to leverage your balance sheet.

“Your personal finances should be in order, make sure that you are ready for the transaction, that you have enough reserves, that you have enough capital, and that your bank supports you,” he told ANC’s “On The Money.”

Financial adviser Salve Duplito, meanwhile, advises entrepreneurs to “think cash.”

“Whether you are buying another business or being bought, being in a position where you either have your own cash or can easily raise it allows you to get more out of mergers and acquisitions,” she said.

Duplito said if you are being bought by another firm and your books clearly show them you are cash-strapped, you will be vulnerable.

“If you are an entrepreneur, conserve cash now and build your reserve funds more aggressively,” she said.

Duplito also suggests guarding your credit worthiness fiercely.

“This doesn’t mean don’t borrow, in fact, it means quite the opposite. Banks find it more palatable to lend to someone they know and have a good track record of payment,” she said.

Entrepreneurs should also know to how to determine the value of their business, or if you are buying a business, not to overpay.

According to Bly, when valuing a company, make sure you have the right advisers.

Choose advisers based on their capability, track record and credibility, not the size of their professional fee.

Bly explained that valuations are affected by continuous cash flow, recurring revenue and growth opportunity.

“The Philippine market is going to be hot in the next 10 years because of the growth opportunity. It’s a young population, it’s a growing population, and it’s education-based. The faster the opportunity for growth, the higher the valuation because as the buyer, you are buying future growth and future earnings,” he said.

Aside from numbers, Bly said entrepreneurs should also look out for other red flags in mergers and acquisitions, such as culture, bad accounting records, personnel files that are not up to date, and bad state of equipment.

source: www.abs-cbnnews.com

Bring financial order to your life in 2015

MANILA, Philippines - Have you ever felt that you are always at the mercy of circumstances where money matters are involved? For instance, are you always running out of cash? Do you feel that your bills are always piling with no reprieve in sight?

Perhaps, it’s time to bring financial order into your life. Financial order, in a nutshell, means being prepared to face your financial obligations without getting stressed to the point of anxiety. Although money matters are not exactly the easiest to think about and may cause you a measure of stress, they should not overwhelm you completely.

Financial order is important. At the very least, it gives you peace of mind. It also keeps you out of trouble and helps you avoid unnecessary expenses and losses. For example, if you missed funding a check you issued by only one day, you could be paying as high as P2,500 in penalties. Same thing holds true for credit card bills.

Creating financial order in your life is possible, but it entails careful analysis of your financial standing, your consumption and spending patterns, and your personal goals. It is both a process and a goal. You have to continuously work to keep financial order in your life, and you should always aspire to achieve or keep it.

Here are some concrete ways to achieve financial order:

Keep records.

By keeping records, you will be able to keep an eye on your bills’ due dates which allows you to plan accordingly. Over the longer term, your records will allow you to monitor your spending and debt levels. There are programs available online to help you do this. If you prefer to keep records the old way, you can get a large envelope where you can file your receipts, bills, credit card and bank statements. It would be helpful to organize these regularly.

Manage expenses.

Are you going overboard with too many expenses? If you keep financial records, you will be able to pinpoint areas where you can cut back or where you can better manage your expenses. Look at areas where you may be incurring unnecessary expenses like paying for too many cable channels you hardly tune in to or gym memberships you hardly have time for.

Have a savings plan.

Once you are better able to manage expenses, you can have a savings plan. Commit to saving a fraction of your income and to add to this regularly. As much as possible, try to allocate funds for savings before you spend your regularly monthly earnings.

Pay debt.

Try to keep your debt level to a level that is comfortable. To know how much debt you currently have, calculate your monthly disposable income. This covers your take-home pay, bonuses, and all other income coming from other sources. Next, compute your monthly payments on all loans. Then, divide this amount by your monthly disposable income and multiply by 100. This will give you the percentage of your disposable income that goes into debt payment.

Protect your income.

One source of financial stress is the fear of leaving your family and loved ones vulnerable if you pass away. This is why it helps to take out a life insurance, especially if you have young children or if you are the breadwinner in your family. Insurance will also protect your assets. If you own a car, consider getting an automobile insurance. If you own property, home insurance is a worthwhile purchase.

Know your net worth.

This is an exercise that everybody should do, regardless of economic status. To know this, add up the value of all your assets (property, stocks, etc.) and income. Deduct the amount of your debt from this amount. The resulting number is your net worth. Note that this may change every year, depending on the value of your assets (e.g. share prices may change) and the amount you owe.

Once your finances are in order, you will be better able to forecast your fiscal activities, and you will be able to create realistic goals that will lead you, eventually, to financial freedom. It’s never too late to start – and 2015 is as good a year as any.

source: www.abs-cbnnews.com

How to Keep Moving Costs Low

Buying a new house usually means spending a lot, and not just on a down payment and closing fees. Moving the contents of your live from one place to another can get expensive, especially if you don’t know where to start. If you need to move on the cheap, consider these tips:

Plan ahead. This is just common sense. There’s a reason last minute costs are always the most expensive. When you wait until days before the move to call a moving company, not only are you missing out on an opportunity to gather quotes, you can end up paying a premium for speed.

Do it yourself. This is always an option, and depending on your individual situation, it may even make more sense than hiring movers. If you’re moving a short distance or with limited belongings, odds are you can manage it on your own for a reasonable price. Try taking it in stages, and remember to be gracious to the friends and family members who pitch in.

If you’re on the fence about moving on your own, there are also some middle ground options, where you pack yourself, and a service or movers ship your belongings to your new location. This is where all that planning comes in handy.

Avoid high moving season. If doing it yourself isn’t an option thanks to a cross-country move or a tight deadline, there are still some things you can do to minimize costs. Waiting to move the bulk of your possessions until fall and winter can make a big difference, for instance. Because these seasons are slow for movers, many companies cut rates, giving you the chance to save. Some moving services are also willing to haggle with you, especially in the off season.

Check for free packing materials. If you’ve ever worked retail, then you know just how many cardboard boxes get broken down and trashed (or recycled) daily. Many stores will have no problem unloading their unneeded boxes on you. One of the best places to ask? The liquor store. Their boxes have to be extra strong to carry glass bottles.

Sell, give away, or pitch everything you can. There’s no sense in paying to pack or move something (especially a large something) that you don’t need, or may not even like.  Moving is the perfect time to turn a critical eye to your junk drawers and closets with that old rule of thumb in mind—if you haven’t used it, worn it, or needed it in over a year, you might as well get rid of it.

Some even advocate selling everything. That’s not quite as crazy as it might sound—it allows you to make money off the things you don’t like anymore or need and save on moving so you can buy what suits you in your new place.

source: totalmortgage.com

How well did you do on the money front in 2014?

MANILA, Philippines - As 2014 draws to a close, this is a good time to look back and see where you have done well and where you can do better in all aspects of your life – from your studies or your career, to relationships, to health and well-being, and even your finances.

Reflecting on how you did in the past year allows you to plan better for the year ahead, because it gives you an insight on your areas of strength and weakness.

One of the good things about assessing how you have done in the financial front is that you have actual records or figures to look at and tell you how you’ve fared. Ideally, you have set out some financial goals and laid out a plan to support them at the beginning of the year. If you did, then it will be easier to gauge your performance against your goals. If you did not have a plan to start with, this may be a good time to start making one.

To have a rough idea of how you managed in the financial front this year, examine your records – bank books, bank statements, credit card statements, tax records, and the like. Look at the following aspects of your finances: your savings, debt, and investment gains (or losses). Look how much you have in each of these categories, and as you go through each one, ask yourself the following questions:

Did you reach your targets?

If you had a pre-set target, then you would know right away if you did. If you had no set target in mind, ask yourself if you are comfortable with the amount you have for savings and investments, as well as your debt levels, with consideration to your current financial status. In thinking about your targets, look into the future and project. What do you want to achieve in the next five, 10, or 20 years? Let’s say you want to buy a house in the next five years using your savings. Look if your savings grew at the pace that will allow you to make the purchase in five years. Look at your investments as well. Are they growing at the pace that they should to meet your goals? Are there other investment products that may be better suited to your profile and support your financial goals?

Did you spend according to your budget?

This will be a good time to think about the purchases and acquisitions you made, and how you’ve kept close to your budget. You can easily tell if you went overboard if you’ve experienced getting your utilities cut off, or are paying a hefty sum for interest expenses. You would also know that if you’ve experienced many cash crunches throughout the year. If you overspent, then think of where you overspent. Did you spend more than you intended to on shopping or entertainment? Or did utilities rise higher than you expected? Ask hard questions. Could it be that your income is no longer enough for your needs, suggesting that you may need to rethink your career plans?

Where did you do well?

Look at everything and identify where you can say you did well. Why do you think did this happen? You might say that your savings improved drastically this year. If it did, what did you do or what were the events that led to this? Perhaps, you cut down on your unnecessary expenses or perhaps, you started putting aside a set amount each month. It could also be that you got a big bonus. Knowing where you did well and how you managed to do so will give you guidelines on how to achieve this again in the coming year.

Where can you improve?

Take a good hard look at where you could have done better, and think of why you have failed to achieve some of your goals. Did you lack discipline? Were you unable to plan in advance? Were you unaware of your financial options? In determining where you can do better, think about your behavior and spending patterns during the year. Did you overspend when you were with friends? Did you buy a car that was too expensive to maintain? By closely examining your expenditures vis-à-vis your daily activities, you may be able to pinpoint specific areas for improvement.

As you reflect on all these questions, you might want to start writing a journal that outlines your thoughts. This will guide you in planning how to address these issues in the months ahead. This early, why not make a commitment that 2015 will be a better planned year for you? Remember the adage – if you fail to plan, you plan to fail. We suggest taking the future with both hands and start securing your financial independence beginning today.

source: www.abs-cbnnews.com

What You Need To Know About Debt Forgiveness

If you have ever had your bank or other financial institution forgive your mortgage you still have to pay taxes on that amount. However, there are some homeowners that have an exception to this especially in recent years.

The following are a few tips issued by the IRS about mortgage and tax forgiveness:
Whenever a debt is cancelled the result is usually income that is taxable. However, one thing most homeowners don’t know is that you may not have to pay taxes on this debt if it was a mortgage on the home you currently live in all year round.

The money must be used for your main home in the form of renovations, additions or remodeling.

$2 million is the limit that can be used in most exceptions and $1 million for a married couple.

In some cases you may have the option of reducing the taxable amount and also the amount of the debt if it is part of a debt consolidation case.

Homeowners who have used some of the money to renovate or remodel their home can also check to see if they qualify for exclusions. Exclusions are monies before the principal is applied.

Proceeds received from any other source will not qualify homeowners for exclusions. For example if debt is obtained from credit cards it will not qualify for exclusions.

Form 982 is the form that homeowners should use if they qualify for exclusions and attached to their income tax forms.

No other debts will qualify homeowners for exclusions. Debts included are rental homes, debt for, credit cards, businesses or a car loan. There are other cases that can also qualify homeowners to use this form such as monies from bankruptcy cases.

If your bank or other financial institution cancelled or reduced your mortgage they will send you a form to be used when filing your income tax. The form is 1099-C and Box 2 should contain the amount that was cancelled or reduced.

These are just a few of the tips offered by the IRS for mortgage forgiveness. If you would like more information just visit the IRS website. Be sure to read all the information available on mortgage forgiveness, cancellation and reduced mortgages. You can also get any other forms you need for filing your income tax including exclusion forms at the IRS website. If you still have questions you can also contact your local tax specialist who can help you with filing your income tax and provide you with all the forms you need.

To see if you qualify for any exclusions you can contact your bank or other financial institution that carries your mortgage. They can also answer any questions you have about mortgage forgiveness as well as determine if you qualify for exclusions.

For additional information on exclusions and mortgage forgiveness you can also search online. Many financial websites have information on both and can also answer any questions you have about your home and your mortgage as well.

source: 20smoney.com

The First Step to Getting Out of Debt

Have you been thinking about getting out of debt? I mean, you have entertained the idea before and paid a little bit toward your credit card once in a while, but you didn’t really take a dive at your debt seriously. If you were truly serious about getting out of debt, you would have changed your lifestyle and would be much richer today.

I strongly encourage you to take the first step in getting out of debt. I took this step over 4 years ago and have been debt free (outside of my mortgage) since February, 2011. Having money at the end of the month and being able to pay the bills without worry has been amazing. Can you imagine an ever-increasing bank account hardly trying? One morning you’ll wake up and just happen to notice that you have over $2,000 in your checking account. A few months later this amount will have accidentally grown to $5,000, and then $10,000. You then start to wonder what you should even do with it! Let me tell you though, these are great problems to have.

Take the First Step: Sell Your Possessions 

At the point when you really become serious about getting out of debt, you want to see your debt total go down, and fast. Typically, this can’t be done with your normal income because you have stretched yourself too thin (in terms of cash flow) as it is, so in order to get your debt payments rolling you’ll need to sell some stuff – obviously, the more the better.

So what kind of stuff should you get rid of? Truthfully, I would just start out selling anything that has a real value and that others would want. If you have outdoor toys like quads, dirt bikes, or wave runners that you hardly use anymore, start with those. They are in the price category that people can easily afford without getting help from the bank. At the same time though, I would put the big stuff on the market. If you have an extra car or a boat that you can really do without (you have to be honest with yourself here), then put them on the market too.

Listing your items through Craigslist is typically the best way to get rid of them. Your customers are local and can quickly come with cash to make the purchase. Within one day of listing your item you could have cash in your hand and make that big deposit into the bank.

From this point you must move on to step two (yes, I’m going to give away step 2, so listen closely). While it will be very tempting to use that money you just received to buy something else, please DO NOT! This money is first for a small emergency fund of $1,000, and then the rest of it is for putting toward your smallest debts (likely a store credit card or a gas card). Then, once you get a small debt taken care of, you can use that money you had been paying each month to that small debt and put it toward the next largest debt. Then, once that larger debt is paid for, you can take that payment and put it toward the next largest debt. This is called the debt snowball. Once it gets rolling, you can really start to pay off your debts in a hurry!

source: lifeandmyfinances.com

Three Ways to Pay Off Your Debt

Are you trying to pay off your debt? If so, then you might be wondering how you should proceed. What’s the best strategy for paying off your debt?

As it turns out, there are three popular methods: the “traditional” method, the “snowball” method, and the “annoying” method. Let’s look at the pro’s and con’s for these popular debt payoff techniques, so that you can decide which one is best for you.

Traditional Payoff Method

Under the traditional model, a person would first make a list of all of their debts, from highest-interest-rate to lowest-interest rate. For example, you might list:

   * Mastercard, $12,000 balance, 14 percent APR
   * Student Loan, $32,000 balance, 8 percent APR
   * Car Loan, $3,500 balance, 3 percent APR
   * Loan from Brother, $5,000 balance, 0 percent APR


A person would make the minimum required payments on all of the above loans, and then use additional money to pay off these loans in the order listed above, from highest-interest to lowest-interest. In theory, this saves the most in interest payments over the life of the loan, and mathematically, this strategy makes the most sense.

Snowball Method

However, another popular method coined by Dave Ramsey advocates ordering your debts based on balance, rather than interest rate. For example:

    *Car Loan, $3,500 balance, 3 percent APR
    *Loan from Brother, $5,000 balance, 0 percent APR
    *Mastercard, $12,000 balance, 14 percent APR
    *Student Loan, $32,000 balance, 8 percent APR



A person would then pay off the smallest-balance-loan first. They’d feel the mental thrill of victory when they got rid of that debt. Then they’d pay off the next, and then the next. Mathematically, this doesn’t make as much sense, since the person would be paying off lower-interest debts first. But mentally, this could help motivate a person to keep going.

Annoying Method

As another option, a person might order their debts based on “most annoying to least annoying.” For example, perhaps that loan from your brother really bothers you and keeps you awake at night, while your student loan doesn’t bother you at all. Or, perhaps the tables are reversed: your student loan bugs you, while the loan from your brother doesn’t.

In this third option, you’d pay off the most annoying loan first, before moving onto the next. This option ignores both the balance and the interest rate, and purely focuses on the psychological impact of the loan.

What’s the Best?

Which of these is the best option? There’s no single right answer. There are some people who fervently believe that paying off loans based on anything other than the interest rate is a sub-optimal idea, and there are others who say that they’ve tried and tried to pay off their loans through a variety of methods, and found that the snowball method works best.

This might be hard to hear — many people want a solid answer — but there’s also a certain liberation that comes from the knowledge that you can pay off your debts in any order that you’d like. Pick whichever route works best for you, and stick with it. The most important detail is that you’re paying off your debt, regardless of the strategy that you prefer.

source: lifeandmyfinances.com

Quick Fixes for People with Bad Credit

Do you have bad credit?  If you do, then you’re not alone.  Indeed, having bad credit is not a good thing and no doubt, you want to get yourself out of it as soon as possible.  The good news is, there are positive steps that you can do to improve your credit. Consider these quick fixes:

Know where you stand.  Have you checked your personal credit report? If you have not yet requested your free credit report for this year, you can go to www.annualcreditreport.com to order.  You can order all your three reports from the three major credit bureaus at once so you can be sure that all versions of your report contain accurate information.

Checking your report will
to achieve a high score.

What’s most important is how you pay off your credit card balance.  It’s best to pay off your full balance each month so you don’t incur interest rate fees.  Use your credit card for a small purchase so that repayment need not be a burden.

Avoid hard inquiries.  If you need to acquire a new credit card or a loan, do not submit multiple applications to different lenders at once.  Doing so will only damage your credit score even more.  What you want to do is spend time comparing your options and once you have the right lender, that’s the time you can submit an application.  Don’t forget to check the lender’s credit requirement to avoid unnecessary rejections as this will also pull down your score.

Keep credit usage minimal.  You want to use your credit regularly but you should keep it as minimal as possible.  In fact, you should not use more than 30% of your available credit if you want to see an improvement in your rating.

Apply for a small loan.  Aside from revolving credit, adding other types of debt to your name is a great way to improve your credit score.  An installment loan whether a personal loan, student loan or a car loan gives you the chance to prove your creditworthiness through timely submission of your monthly payments.

Acquire a small loan with just the right period of repayment.  Choose a lender that offers a reasonable deal.  Furthermore, make sure that the loan provider reports to the three major credit bureaus.  As you submit your monthly loan payments, you will strengthen your credit history and add points to your score.

source: creditcreators.com

How to set your financial records straight

MANILA, Philippines - Did you ever have to replace a malfunctioning gadget but couldn't claim a warranty because you've thrown away the receipt?

Have you applied for a travel visa and found yourself unable to produce bank statements because you don’t even know if you have those?

Have you had to avail of medical insurance but couldn't tell the hospital your account number?

Keeping financial records can be quite a chore, given the volume of papers that we have to track. Yet it is something you cannot avoid and will have to do. It is also one of the most important, yet often overlooked, aspects of personal finance management.

There are definite advantages to keeping and organizing your records. You save time, money and avoid inconveniences that may arise when you suddenly need documents to prove your identity or your financial capability for various reasons -- to get travel documents, use pre-need plans, apply for credit cards and loans. For financial planning purposes, having records are the first step to help you monitor your expenses, your spending behavior, and better understand or predict your cash flow.

Understandably, you wouldn't want to keep all records forever, so you need to think about what records you should keep, how you should keep them, and for how long.

There are some records that you instinctively know you should keep: proof of ownership of property, certificates of deposit, government-issued documents such as certifications, service warranties, tax payments, and the like. There are others that you may want to hold on to for a given period of time before disposing of these.

For instance, you can keep receipts of items you’ve bought using your credit card for reconciliation purposes until the statement arrives, then dispose of it. You can wait till you get the annual summary of your investments before throwing away your quarterly statement of accounts, and hold on to home, car, and medical insurance policies until they are renewed.

On the other hand, receipts for significant purchases like jewelry, appliances, and cars — along with corresponding service contracts and warranties— must be kept while these are in your possession. Tax records and their supporting documents should be retained for generally three years, coinciding with the 3-year statute of limitations, although some tax consultants have advised businesses to hold on to their tax records for as long as 10 years.

Here are some ways to help you with record-keeping:

Spend a few minutes every week to go through your records, paying special attention to those that are time-sensitive such as bills and payments. If you run a home office, make sure you do not mix your personal records and your home business records.

Have a temporary record storage area.
If you do not have time to check records daily, you can try to have an expanding envelope where you can temporarily stuff all receipts, statements or documents that you are unable to check or sort right away. It may be a good idea to have another smaller envelope specifically for important records in your bag. Put documents that you receive in the course of the day – at the office, for instance -- in this envelope, then transfer the contents of this to the expanding envelope you have at home. At the end of the week, go through the contents of this temporary file storage and sort out its contents.

Think of a filing system to categorize your records.

Make sure that this would fit your lifestyle and that you are comfortable with it. One way is to arrange your files according to date and category. Another example is to arrange them in four groups: Active File, Inactive File, Important Papers, and Throw Away.

The Active File consists of documents vital to the everyday operation of your household. These papers should include: appliance manuals, warranties, and service contracts (including their receipts); bank statements; bill payment receipts; billing statements (from utility and credit card companies, among others); credit card information; employment records; health benefit information; insurance policies (car, home, and life, among others); loan statements; safe deposit box inventory (and key); tax receipts

Inactive File. Documents from the Active File that are three years and older can be transferred to the Inactive File.

Important Papers are those that are irreplaceable or difficult to replace. These documents include: Certificates of deposit; contracts; deeds and property titles; life insurance policies; passbooks; Power of attorney; stock and bond certificates

Throw aways are those that have you have no need for . This would include expired insurance policies, receipts that are of no consequence, billing statements that have long been paid for, etc.

Label your records for easy reference.

For example, documents pertaining to your property could fall under “Real estate assets” while utility bills could be marked as simply “Utilities.”

Have back-up files of your most important documents.

Have photocopies or scanned copies of your passport, property titles, and investment certificates that you can store electronically. Alternatively, you may take photos of these using your smart phone. There are many apps that now allow you to store images of your records using the cloud.

Keep a list of the documents that you have.

Over the years, you may no longer remember what you have. This list will make retrieval easier and faster.

Originals of important records must be kept safe and secure in a secondary location like a safe deposit box at the bank, which you can avail of for a minimal fee. If you prefer to store them at home, then you must do so in a fireproof and waterproof safe. Place the documents in Ziploc bags or other airtight waterproof containers before putting them in the safe.

Let your spouse or closest next of kin know where to look for the most important records in the event that you are not physically present to retrieve these. If your original documents are in a bank safety deposit box, you might want to have a Power of Attorney left in an easily accessible place for them to access your safety deposit box in your absence.

When disposing of financial records, take the necessary precautions to protect your personal and financial information against identity thieves. Tear these documents into little pieces or get a portable paper shredder to help you dispose of stale documents.

source: www.abs-cbnnews.com

Car Loan Tips for A First Time Car Buyer

So you’re planning to purchase a car early next year but are you prepared?  Next to a home, a car is a huge investment and you can’t afford to make a poor decision which can have serious effect on your finances.  In this article, let’s check out valuable tips especially for a first-time car buyer:


Know your personal budget.  Deciding on the type of car and the loan package that fits you will depend on your financial capability.  Aside from the price of the car, you should not forget to take into account other costs such as insurance, taxes, and maintenance expenses.  Don’t forget to consider your budget and personal income before making your choices.  More than anything else,


providers may consider a number of factors such as the borrower’s income, age, credit score, driving history, etc.

If you have an excellent credit history and rating, then you are most likely to get the best car loan offers from lenders.  On the contrary, having a poor credit score or a lack of credit history can be a major drawback.

Students and new car drivers might find also find it a challenge to get approved for a low-rate loan since many lenders make decisions based on income stability and driving record.  However, if you’re an honor student or included in the dean’s list, you might be able to win ask for a lower interest rate as an exemplary academic standing is usually regarded as a sign of maturity and dependability.

Watch out for car loan scams.  As with other industries, car loan scams are prevalent in the market.  You might come across car dealerships that offer quick loans and guaranteed bad credit car financing.  It might be tempting to sign up the contract right away especially when the dealer gives enticing promises. People with bad credit who cannot qualify for a regular car loan should be particularly cautious about bad credit loan offers.

However, a lot of consumers have fallen for these tactics and found themselves stuck in an expensive car loan because the dealer was obviously after one thing – to make money at their expense.  When visiting a car dealer’s, don’t sign anything at their location.  Go home, do more research, evaluate the deal, check the company’s reputation, before making a decision.

source: creditcreators.com

8 Easy Steps We Used to Pay Down $60,000 in Debt - Fast

There are plenty of ways to wind up with debt. You can acquire it as the price of a good education. You can pile it on when bad stuff happens to your house. Or you can simply spend too much money at the mall. With almost $60,000 in consumer debt, I was guilty of all of these -- and more.

Worse than just having debt, I was in debt denial. I happily made my credit card and auto loan payments every month without thinking twice about them. In my mind, I was doing the right thing. I had no idea what kind of impact my debt was having over my financial life.

Then, in the fall of 2011 my wife and I found out that we were expecting, and realized immediately that our spending habits needed to change. We didn't want our children to be burdened by our financial mistakes. Together, we made a plan we hoped would eliminate our debt before the birth of our new baby.

We didn't quite make that deadline, but 12 months later, we were completely debt free. Here's the basis behind our strategy:

Step 1: List All Your Debts, Their Balances and Interest Rates

Go to the website of every financial institution to which you owe money. Copy down all the balances and their respective interest rates, exactly as they appear. It's also important to know what your minimum payments are for every account.

Step 2: Set Periodic Goals
Short-term goals allow us to break really hard things into manageable chunks that we can feel good about after we complete them.

When you set a goal to pay off your all debt, you first need to assess how much money you can contribute to debt repayment every month. Divide your total debt by your planned monthly repayment amount. This will give you roughly the number of months it will take to become debt free. This isn't accounting for interest, of course, so understand it'll likely take you longer than that to repay your debt, but it's a fair gauge of how much longer you have to bear this burden.

Step 3: Start Paying Off Your Balances from Highest APR to Lowest

Each month, make the minimum payment on every account, then dedicate all the rest of your debt repayment budget to the one that you're trying to eliminate first -- the one with the highest APR. Over time, this allows you to waste as little as possible on interest.

When you pay off one debt, that frees up money that you can now use to tackle the next debt down the list. This concept is known as " the snowball plan."

Step 4: Trade In Big Ticket Items

Do you still owe big money on your vehicle? You can significantly reduce your total debt by trading in your car for something cheaper. If you can get $18,000 for a trade-in, and find a $10,000 car on the lot, you just came into $8,000 to help you pay off debt.

You can apply the same idea to boats, yachts, jet-skis, snowmobiles, among other items. Now isn't the time to have pricey toys. You can have toys when you're debt-free.

Step 5: Sell Almost Everything

Now that all of your big ticket items have been either sold or traded in for less expensive versions, you can start becoming a professional Craigslister.

Carry around a notebook and write down every item that you use over the course of a given week. You'd be surprised with how little of your stuff you actually use. Why not try to turn some of your less-used items into cash?

Step 6: Work, Work, Work

This one is going to blow your mind: To pay off debt faster, you can work more. Overtime, second jobs, babysitting, etc. More money, more debt repayment.


Step 7: Reward Yourself for the Small Wins

Achieving a goal, no matter how small, should be celebrated. Naturally, this doesn't mean that you should go out and spend hundreds of a dollars at the mall for paying off $100 of your debt. Instead, splurge small -- perhaps on one of those fancy coffee drinks you've (wisely) been denying yourself.

Or, as a free alternative, you can guilt people into congratulating you by posting your achievements on Facebook.

Step 8: Use Windfall Money Wisely

My definition of windfall money is "any money that you receive that didn't directly come from your employment." Tax refunds, bonuses, inheritances, birthday money, wedding gifts, whatever. If you are in debt, windfall money isn't fair game for fun. You should apply it directly to your debt. You couldn't ask for a better gift than being closer to debt free, so don't blow it.

Congratulations, You're Debt Free

Now that you've made it, teach your friends and family how they can accomplish the same thing. You'll be living proof that it's actually possible.

source: dailyfinance.com